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From October 2016 to March 2017 the team is joined by Guest Kats Rosie Burbidge and Eibhlin Vardy, and by InternKats Verónica Rodríguez Arguijo, Tian Lu and Hayleigh Bosher.

Monday, 5 January 2015

One of the AmeriKat's New Year's resolutions: after blog more, sleep more. . .

With the fresh promise of a new year, many of us concoct plans to refresh, reinvent and re-energize our lives. New Year's resolutions are personal innovations to improve upon the version of yourself that went before with the promise that you emerge better, stronger and healthier (see for example, Marilyn Monroe's 1955 resolutions here). The intellectual property system is the same - designed to incentivize improvements of what went before or what has never even been. Innovation is always a buzzword in intellectual property law, for obvious reasons. You cannot (or should not, at least) have intellectual property without innovation and vice versa.

In 2008, the European Commission published its intellectual property strategy for Europe which recognized the need for strong IP rights in order to protect Europe's innovations so as to remain competitive. The report stated:

"Protection of intellectual property is a key framework condition for innovation, stimulating R&D investment and transfer of knowledge from the laboratory to the marketplace. A clear regime for intellectual property rights is an essential condition for the single market and in making the "fifth freedom", the free movement of knowledge, a reality. This may also contribute as part of wider policy to finding solutions that could address global issues of increasing significance such as climate change, the ageing world population, and a possible energy crisis."

Six years later in March 2014, the Commission published the "Innovation Union Scoreboard 2014". The annual Innovation Union Scoreboard compares the research and performance of the EU Member States, together with the relative strengths and weaknesses of their "innovation systems". It provides a ranking based on individual indicators including education, scientific publications, R&D expenditure, Community trade marks, designs and PCT patent applications (including those in targeted industries, such as health and climate) and compares those Member States with other countries, including China and the US.

Summary chart for Europe's innovation performance for 2014

In the 2014 Scoreboard, Denmark, Finland, Germany and Sweden came out as "Innovation Leaders" with innovation performance above the EU average. The UK, Ireland, France and Luxembourg fell within the "Innovation followers" category with innovation above or close to that of the EU average. Italy, Spain and Poland were ranked as "Moderate innovators". Denmark, Austria, Germany and Sweden were in the top positions for "intellectual assets" which caters for IP rights including PCT application applications (the EU average was 3.9 PCT patent applications per billion GDP). The report records that overall "the EU annual average growth rate of innovation performance reached 1.7% over 2006-2013 with all Member States improving their innovation performance."

The US and South Korea, however, outperformed the EU both by 17% and by Japan by 13%. The report continued:

"The top innovation leaders US, Japan and South Korea are particularly dominating the EU in indicators capturing business activity as measured by R&D expenditures in the business sector, Public private co-publications and PCT patents but also in educational attainment as measured by the Share of population having completed tertiary education."

Although the report states that the US's lead is decreasing, it cites that the US continues to outperform the EU including by spending about 40% more on R&D and being more "successful in commercializing new technologies with 17% more Licence and patent revenues compared to the EU".

With the sun rising on 2015, willEurope prioritize innovation?

Although the 2015 Scoreboard has yet to be published, headlines like "Europe continues to fall behind in race to innovate" published by the Financial Times' before Christmas continued the theme of Europe's lagging performance in the innovation game. It reports, according to WIPO, that European Patent Office's share of the 9% worldwide increase in patent filings fell to 5.8% (the lowest on record). The increase in patent filings, however, has to be tempered with the fact that the patents subject of the applications have not been tested before the examiners or the courts. As the Economist referred to in their 14 December 2014 article, the increase of filings in China, for example, could in fact be an innovation fiction.

With the promise of the new Unified Patent Court harmonizing the protection and enforcement of patents, Europe has taken some steps to improve upon what has been before (although there is of course debate on that point as well). However, if the picture presented by the Commission and WIPO accurately represents the current status of innovation in Europe then improvements must be made - especially if this CNN opinion piece is to be believed.

So far, a blank space. But whatshould be on Europe's 2015 New Year's Resolution Post-it?

But what should Europe's New Year's innovation or IP resolutions be? To identify potential resolutions, one first must identify the frustrations or areas for improvement. For example, should Europe's IP decision makers (politicians, EU legislators, judges, etc) improve their understanding of intellectual property? Should the European Union's legislative process in relation to IP rights become more transparent with US-style public hearings and accountability? Should immigration polices be crafted to reflect the need for innovation and creation of IP (see Sir Dyson's recent comment here)?

So while our dear readers are sweating and toiling away at their personal New Year's Resolutions, the AmeriKat asks that readers take a beat to ponder what they think Europe's innovation or IP resolutions should be for 2015. Post your resolutions below or e-mail the Kat at theipkat@gmail.com. The top resolutions will be subject to a follow-on post (and maybe more).

The rapporteur for the Parliament's report on the current copyright environment as shaped by the InfoSoc Directive, Julia Reda, also seems pretty transparent -- for example here's the planned schedule she posted on 16 December for the proposed stages and discussion of her report.

In general EU Parliament committees seems to me rather more transparent and accountable than e.g. US Congressional committees, where far more power can rest with the chair of the committee, who can radically change or kill legislation outright by his own action or inaction, rather than EU Parliament committees where every step has to be hammered out by painstakingly assembling a consensus or a majority.

Of course, other parts of the EU system -- the Commission and the member states -- can be a lot more secretive and high-handed.

But for the most part it is unfair to tar the EU Parliament with that brush.

How does a democracy enthuse its public with the notion that technical innovation is a good thing, to be encouraged under the law? I don't know, but one way is to promulgate declaratory law that announces relevant objectives. These might include:

1. An employee inventor law inspired by Germany's (and in Japan) but tweaked to cut out the bureaucratic aspects.

2. A system of litigating IPR disputes that meets the over-riding objective of doing justice quickly, fairly and proportionately. Again, borrow from Germany but get rid of the defects in the German system. We are on the way.

3. A patent eligibility filter that confines patentable subject matter to that which uses technical means to solve a technical problem ie, that declares that the only sort of non-obviousness that counts towards patentability is technical creativity (as opposed to business or financial creativity). We are on the way.

4. Foster an entrepreneurial business culture. Not so easy. But it's coming, isn't it?

Top innovative resolution from the EUrocrats: let's have more standards and patents. That way, we can advance technology, shut out Messr Jean L' Etranger, and keep our IP litigators busy at the same time. Hurrah!

Transparency at the European Parliament? Well sort of. Like watching a car crash in slow motion through a strong, soundproof slab of glass. You can see quite a bit, but you can't do anything to influence the inevitable messy, unpleasant outcome.

"I wonder if MaxDrei will chime in with a comment on that statistic..."

Personally, I wonder if people will start having minds of their own.

Have your own opinion. Upset the herd by challenging their ill-considered collective viewpoint.

I wouldn't class the UK as a follower. The term doesn't apply just because a nation is not doing as much as others. The UK is, however, sliding dangerously into the abyss as far as R&D is concerned in several industries. A nation of shopkeepers, but this time without the industry to pay the customers.

The US has investors that are willing to take risks, which those in, for example, the UK will not. If I had a small fortune to invest in the UK I may look to schemes such as solar-powered electricity. I could buy 10 acres of poor quality farmland, fill it with solar panels, sell the milliwatts of electricity I produce to the National Grid and receive a payment far in excess of that which is competitive and make a very good guaranteed financial return on my investment.

MaxDrei says: "How does a democracy enthuse its public with the notion that technical innovation is a good thing, to be encouraged under the law? I don't know, but one way is to promulgate declaratory law that announces relevant objectives."

Regrettably, most of the population doesn't give two hoots about what declaratory law says until it requires them to change their behavior. I don't think that IP law tweaks enthuse a public with the notion that IP is a good thing any more than tax law tweaks enthuse a public with the notion that entrepreneurship is a good thing. Both help existing innovators/entrepreneurs, but do little to change the views of the wider public. This is what STEM educators have been up against for years: tweaking public policy to make something economically attractive does not create enthusiasm or make something "cool". For that you need a supportive education providers, relevant role models, and the acknowledgement of tangible benefits from various sectors, not just top-down policy statements and ministerial wind.

Often when stats are adjusted for a 'per capita' figure the US is comparable to other countries, but I think it has unique strengths. Not many other countries could have developed Google, Facebook, Twitter, YouTube, and these are now acting as platforms which the rest of the world is using. The US is good at doing 'big' and that means they have an advantage in developing certain technologies. The UK remains brilliant in scientific creativity, but the funding system and ability to take a long term view remain poor.

Here, in the states, that wisdom was reflected in the words of Adam Smith and the notion of the invisible hand.

It is that same notion that Abraham Lincoln referenced, and that a STRONG patent system serves to encourage.

And yet (still), this aspect that makes the American patent system a promoter of the thing that MaxDrei claims that he wants promoted is (elsewhere) also denigrated by that same commentator.

It was this very conflict which prompted me to post for his views on the subject here (and not that I need to know what he thinks in order to follow him). Consistency may, just may, lead to his edification and enlightenment.

Very much similar to the US stance on business methods, I would daresay that its stance on software patents (regardless of the antagonism so often heard) is one of those contributing factors to this unique ability.

Watson's magisterial book of the "German Genius" reveals how the attitude to technology in Germany and England has been poles apart, by now for at least two hundred years. Watson writes that in the 19th century, for example, there were still only 2 universities in England but already 50 in Germany. Striking is how today's lamentable attitude which the English "establishment" has to technology (despite its cringeworthy protestations to the contrary) is no different from what it was in the last quarter of the 19th century, when Germany was industrialising itself. Watson notes that Germans were observing, even then, that in England the interest in innovation runs only as far as the possibility to make a quick buck on the stock market.

So how come, despite all that, the Allies nevertheless beat them in both World Wars? Watson gives us the answer to that too. They showed too much deference to deranged leaders, and "our German scientists" were better than their German scientists".

Incidentally, how is Osborne's "March of the Makers" coming along? Has it turned England into a nation of manufacturers yet? If not, why for goodness' sake is it taking so long?

The blogging team over at the CLIP Board blog (on the competition law / IP interface) have taken up your challenge of suggesting an innovation-focussed New Year's resolution. Our suggestion (which, funnily enough, relates to the treatment of innovation in the competition law context) is over at:http://www.bristowsclipboard.com/post/resolutions-for-innovation-in-2015.Happy New Year from all at the CLIP Board!

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